McDonald'sUK to improve image with ethical coffee deal

from Brand Republic

LONDON - McDonald's is to sign a £1m deal this week to buy coffee from South and Central American farm co-operatives certified by the Rainforest Alliance, an independent ethical trade watchdog, in an attempt to improve its reputation.

In a move to attract the ethical consumer, McDonald's will pay more than 3,000 farmers and their families in 15 countries across South and Central America £900,000 for 800 tonnes of coffee. The deal also includes an extra 5.5p for every 1lb sold. The average premium per coffee family works out at £33, a report in the Sunday Times said.

McDonald's sells 143,000 cups of coffee in its 1,200 outlets daily. The deal could be worth as much £50m in the end to coffee farmers because the fast food giant plans to roll the scheme out across the rest of its outlets in Europe.

Steve Easterbrook, chief executive of McDonald's UK, has said the coffee deal would completely change the market for sustainably grown coffee in the UK.

Easterbrook said: "We are a modern, progressive company. We offer our customers great-tasting coffee that also benefits coffee growers."

The company recently announced its menu was going "back to basics" after the failure of new, healthier products.

Easterbrook said: "As we re-examine our global trading deals, we are also making menu and ingredients changes at home. Is there more we can do? Yes, of course. And we will continue to work on that."

Unlike the Fairtrade Foundation, the Rainforest Alliance does not guarantee premium prices, but rather says farmers get significantly higher prices.

To publicise this change, McDonald's is launching a £500,000 radio and poster ad campaign created by Leo Burnett to promote this ethical change using the tagline "because our coffee doesn't cost the earth".